Amazon Stock Cut in Half as eCommerce Giant Can’t Stem Slump

From an all-time high in 2021 to a 3-year low in 2022, Amazon will ring in the New Year about half as large as it was a year ago.

While the staggering $900 billion, 50% contraction in Amazon’s stock over the past 12-months is its first negative annual return since 2014, and its largest percentage drop since falling 79% during the dot-com bubble pop in 2000, the path to its present trough has been strewn with efforts and innovations aimed at righting the ship and restoring investor confidence.

While the outcome of 2022 is clear, we revisit the journey that brough the Seattle-based ecommerce giant to where it is today — and perhaps will set it up for where it is headed down the road.

Herewith is a month-by-month reflection on a year of peaks and valleys for a company that’s unaccustomed to not winning.

January

Achieving ignition on its connected car ambitions, Amazon kicked off the year by announcing its pact with automaker Stellantis whose brands include Alfa Romeo, Chrysler, Dodge, Fiat, Jeep, and Maserati, among others. The objective is to create the ultimate connected car.

Amazon CEO Andy Jassy promised connected and personalized in-vehicle experiences and the transformation of Stellantis from a traditional automaker into a global leader in software-driven engineering.

Amazon, Stellantis Signed Deal to Build Connected In-Vehicle Experiences

February

Acting on complaints of bogus reviews hurting Amazon sellers, in February the company filed lawsuits against “fake review brokers who orchestrate the posting of incentivized and misleading product reviews in exchange for money or free products.”

Dharmesh Mehta, VP of WW Customer Trust & Partner Support at Amazon, said “Fake review brokers attempt to profit by deceiving unknowing consumers and creating an unfair competitive advantage that harms our selling partners. We know how valuable trustworthy reviews are to our customers. That is why we are holding these review fraudsters accountable.”

Amazon Levies Lawsuits Against Fake Review Brokers

March

With the first quarter coming to an end, the company unveiled Amazon Glow,  its first digital device designed specifically for young children. It came with a library of Amazon Kids+ games, visual arts activities, books, and immersive features.

Amazon Kid-Centric Video Call Device Glow Now Available to All

April

As Q2 got underway Amazon unveiled Buy With Prime, enabling other eCommerce merchants to take orders from Prime members and extending the same benefits, from free shipping to free returns, all through other sites and marketplaces. The objective, as Amazon stated, is “ultimately increasing selection for Prime members.”

It also deftly expanded Amazon’s selling universe.

We also got a taste of how bad the inflation problem was going to be in Amazon’s first-quarter 2022 earnings, as cash flow decreased and net sales grew an anemic 7%. In announcing the results, Jassy said “Today, as we’re no longer chasing physical or staffing capacity, our teams are squarely focused on improving productivity and cost efficiencies throughout our fulfillment network. We know how to do this and have done it before. This may take some time, particularly as we work through ongoing inflationary and supply chain pressures.”

Amazon Online Sales Decline 3% YOY, Sets Sights on Prime Day

May

Spring sprung with the opening of Amazon’s first brick-and-mortar clothing store, using machine learning to assist shoppers in picking the perfect outfit.

The company said the Amazon Style store “is designed to help customers discover looks they’ll love through a personalized and convenient shopping experience using advanced technology and world-class operations, and our team of employees is dedicated to helping customers find looks they love and feel great in.”

Amazon Opens 1st Brick-and-Mortar Clothing Store in LA

June

Helping move apparel and accessories with smart tech, in June Amazon Fashion took the wraps off of Virtual Try-On for Shoes, described in a press release as an interactive use of augmented reality to help customers visualize how a pair of shoes will look on themselves from every angle, all from their mobile device.

Amazon Adds Virtual Try-On for Shoes

July

Prime Day took place July 12-13, and Amazon rolled out the eCommerce welcome mat, tantalizing shoppers with a July 6 preview announcing new benefits and deals for Prime members, including “a free, one-year Grubhub+ membership with no food-delivery fees on eligible orders” available in over 4,000 cities, and teased exclusive content for the hotly awaited premiere of The Lord of the Rings: The Rings of Power and “exclusive deals for Prime members ahead of Thursday Night Football’s anticipated launch.”

The subsequent PYMNTS report Prime Day 2022: Inflation Hits, But Amazon Still Wins noted that “median receipts jumped to $175 — up 40% from 2021 — and 74% of shoppers spent less than $500. Two key trends help explain the divergence between higher median spending and reduced big-ticket purchases. First, many Prime Day shoppers likely accelerated planned purchases to secure savings, effectively cannibalizing future sales. Second, the rates of Prime members buying groceries and other everyday items increased modestly this year compared to 2021, reflecting an increased focus on necessities and basics.”

In some ways, bigger news this month was Amazon’s agreement to acquire national primary care organization One Medical. “We think health care is high on the list of experiences that need reinvention,” said Neil Lindsay, SVP of Amazon Health Services.

Amazon to Buy One Medical for $3.9B to Expand Healthcare Offerings

August

Deep summer found the eCommerce conglomerate going deeper into robotics, acquiring iRobot. In a statement, Dave Limp, SVP of Amazon Devices, discussed the ways robots can save precious time on housework.

As PYMNTS Karen Webster wrote of the deal: “For Amazon, iRobot is about strengthening and monetizing the cross-activity network effects of the consumers who have  connected more than 300 million smart home devices such as lights, curtains, thermostats, and vacuums to Alexa and therefore already value the convenience of an AI-powered smart home.”

Not to be forgotten is the premiere of The Lord of the Rings: The Rings of Power, which Amazon said: “attracted more than 25 million global viewers on its first day, breaking all previous records, marking the biggest premiere in the history of Prime Video.”

What New Data Shows About Why Amazon is Buying iRobot

September

Back-to-school season on Amazon was all about helping sellers on its platform sell. In September the company introduced three new audience types within the Amazon Customer Engagement tool to help sellers increase their email marketing reach. This allowed sellers to expand beyond brand followers when sending free marketing emails.

Also launched at the Accelerate seller event were new features to Manage Your Experiments, “a tool that helps sellers optimize content on product detail pages to drive higher rates of conversion, increasing their sales by up to 25%.”

Amazon Buys Shipping Software Veeqo, Adds Fulfillment Dashboard, Seller Analytics

October

The big story in October wasn’t Halloween, but what some called “Prime Day Part 2” — the Prime Early Access Sale. “Our Prime Early Access Sale was a great kickoff to the holidays, and the best part is that it’s only the beginning. Customers will find millions of must-have deals throughout the season that will help them continue to save money on gifts for loved ones,” said Doug Herrington, CEO of Amazon Worldwide Stores, in a statement.

Amazon’s Prime Early Access Sale Will Be Retail’s Inflationary Windsock

November

It was a busy month in Seattle as Amazon launched its Merchant Cash Advance Program with Parafin, supporting SMBs with a new source of growth capital.

From there the action moved to Black Friday and the Cyber Five — Amazon’s third major sales event in 2022, and a winner, as PYMNTS reported that “consumers also supported smaller businesses…to the tune of $1 billion in small business sales in the United States.”

Amazon Reports Largest-Ever Thanksgiving Shopping Weekend

December

It’s been a long December as the song goes, but short on big news out of Amazon.

However, the company did announce that it’s teaming with game maker Crystal Dynamics to “develop a new multiplatform Tomb Raider title, with Amazon Games providing full support and publishing the game globally.”